CoinDCX hit by USD 44.2 mn security breach; founders say customer funds unaffected, safe
New Delhi, Jul 20 (PTI): Indian cryptocurrency exchange CoinDCX has suffered a security breach, resulting in theft of USD 44.2 million, or Rs 378 crore, even as the founders took to X to reassure that customer funds remained unaffected and safe, with the compromise limited to an internal operational account.
The total exposure is being absorbed entirely by CoinDCX, using the company's treasury reserves, the company said in a First Incident Report released on Sunday.
According to the report, on July 19, at 4 AM IST, CoinDCX security systems detected an incident involving unauthorised access to one of its accounts on the partner exchange, leading to a financial exposure of about USD 44 million.
The incident once again puts the spotlight on mounting security threats in the highly volatile world of cryptocurrencies. Last year, crypto exchange WazirX faced a hack in India, leading to the loss of more than USD 230 million, and marking one of the biggest such heists in India. The theft had prompted a thorough examination of safety measures and eroded sentiments.
CoinDCX co-founders Sumit Gupta and Neeraj Khandelwal took to the social media platform X to address the situation, confirming that the attack was the result of a sophisticated server breach, targeting an internal wallet, not the ones holding customer assets.
The incident was first flagged by blockchain investigator ZachXBT, following which the exchange made the disclosure public.
"Today, one of our internal operational accounts -- used only for liquidity provisioning on a partner exchange -- was compromised due to a sophisticated server breach. I confirm that the CoinDCX wallets used to store customer assets are not impacted and are completely safe. This won’t cause any loss to our customers. CoinDCX will be bearing the full amount," Gupta said.
"The total amount lost was USD 44Mn out of our treasury assets. Coindcx Treasury will be bearing these losses," Khandelwal wrote.
Following this, users rushed to check their balances, leading to a spike in withdrawal requests. The sudden surge in activity led to CoinDCX’s portfolio APIs, which display user balances and transaction histories, becoming jammed and unresponsive. For several hours, many were unable to even see their holdings on the app, adding fuel to rumours and anxiety online.
The co-founders later updated that Portfolio APIs have been restored.
Affected infrastructure has been completely isolated, and CoinDCX operations continue to run normally, the company said.
CERT-In, or the Indian Computer Emergency Response Team, has been informed about the incident. Detailed forensics with two globally reputed security agencies is being carried out, and reports will be shared for public benefit, it added.
"CoinDCX services remain fully operational. Trading activity, INR deposits and INR withdrawals continue. INR withdrawals below Rs 5 lakhs will reflect in your account within 5 hours, while withdrawals above Rs 5 lakhs will be processed within 72 hours. The incident was isolated and has no impact on your portfolio access or operations," the company stated.
Social media is flooded with mixed reactions. While some praised CoinDCX for absorbing the losses and protecting user funds, others criticised the delay in public disclosure and raised concerns over the broader security of crypto platforms in India.
"Coindcx silent for 17 hours? That's more suspense than a thriller! In crypto, transparency isn't optional; it's key. Stay open to keep trust alive!" a user wrote.
"Good to see CoinDCX acting responsibly, assuring user funds are safe, and not passing losses onto customers. Sets a positive precedent for Indian crypto exchanges," another said.
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Mamata visits Bhabanipur EVM strong room, warns against counting irregularities
Kolkata (PTI): West Bengal Chief Minister and TMC supremo Mamata Banerjee early Friday warned against any attempt to tamper with the counting process, hours after she visited an EVM strong room in Bhabanipur, alleging possible malpractice.
Banerjee, who emerged around 12:07 am after spending nearly four hours at the counting centre for her Bhabanipur constituency housed in Sakhawat Memorial School in south Kolkata, said only one person would be allowed inside the designated counting area.
"Either the candidate or one agent can stay upstairs. I have also suggested installation of a CCTV camera for the media," she told reporters.
Stressing the need for transparency, she said, "It is essential to maintain transparency. People’s votes must be protected. I rushed here after receiving complaints. The central forces initially did not allow me to enter."
Sounding a stern note ahead of the May 4 counting, she added, "If there is any plan to tamper with the counting process, it will not be tolerated."
On Thursday evening, Banerjee had reached the Bhabanipur Assembly segment counting centre, which houses the strong room for EVMs used in the April 29 polling, citing suspicion of tampering with the machines.
She entered the premises along with her election agent and remained inside for hours, even as Kolkata Mayor and TMC candidate from the Kolkata Port segment Firhad Hakim reached the spot but could not meet her.
"I reached here upon learning that the chief minister has arrived. But I couldn’t meet her since she was already inside the premises, exercising her right as a candidate to visit strong rooms. I wasn’t allowed there. I will not be able to confirm what exactly is transpiring inside," Hakim said.
The development coincided with protests by TMC candidates Kunal Ghosh and Shashi Panja outside the Khudiram Anushilan Kendra in north Kolkata, where they staged a sit-in alleging irregularities and possible tampering of EVMs stored in strong rooms, leading to face-offs between TMC and BJP supporters.
Earlier in a video message, Banerjee had urged party leaders, workers and polling agents to maintain a 24-hour vigil on EVM strong rooms, alleging that the BJP could attempt to tamper with the machines before counting begins.
Her remarks come amid heightened political tension in the state following a fiercely contested Assembly election, with parties closely monitoring arrangements and raising concerns over transparency.
